Macquarie Research conducted a marketing across the US last week and met with 41 investors. It said buy-side appears to be split on the sector with long-only funds generally bullish and hedge funds almost unanimously negative on the sector.
In addition, the research house said November's shadow banking data signals continued weakness in GGR. According to China's PBoC reported November loan data; shadow bank lending growth continues to slow from >30% YoY in early 2014 to just 14% in November, the lowest since June 2009.
It said shadow bank lending closely leads Macau's GGR growth, which is the ultimate source of speculative liquidity for Macau's high roller players who contribute a large portion of Macau gaming revenue (VIP and premium mass).
Macquarie believes that over 90% of Macau's premium players are SME bosses from traditional industries such as real estate, manufacturing and mining. These "old economies" are getting hurt under Beijing's deliberate action to contain a multi-year shadow banking credit bubble to curb speculative investments and overcapacity in numerous industries.